Archive for June, 2011

Describe the type of financing transactions in financial assets and / or inventory financing

Response Marc This is called “asset-based financing” Here the writing about him in Wikipedia. secured in the simplest sense, a kind of asset-based loan from a loan asset is That is, if the loan is not repaid, the asset is taken. In this sense, a mortgage is an example of a loan asset-backed securities. Most often, however, the term for loans to corporations and large companies do not typically used to describe resource utilization other loans. Generally these loans to inventory, accounts receivable, machinery and equipment are bound, but can also exotic things like the value of the pharmacy script files, brand, or the entire real estate assets intellectuelle.Ce type of loan is usually done when the normal ways of fundraising, as the capital markets (selling bonds to investors) or normal unsecured or mortgage secured bank lending is not possible. This is usually because the company in financial difficult situation. Thus, the asset-based lending can be compared to subprime loans. It is usually accompanied by high interest rates and can be very lucrative for the parent company. For example, the bank Wells Fargo more money from a loan company based on assets as a (. Have loans and paid services), the rest of the business you can speak receivable factoring is a subset of asset-based lending: Factoring is a financial transaction , where a company sells its receivables (eg invoices) a third (called the factor) at a price in exchange for immediate cash with which to finance companies can continue. Factoring differs from a bank loan in three ways. First, research will focus on. the value of claims (essentially a financial asset), the solvency of the company’s second factoring loan – it is the purchase of a financial asset (debt) Lastly a loan. Bank consists of two parts while factoring involves three parties directly involved are trois.Les. Who is to blame, the debtor, and the factor sells The claim is essentially a financial asset to the debtor of the liability associated with amounts paid by the seller (usually sells for the work done or goods). The seller then sells one or more of its invoices (receivables) at a price below the third, the expert panel for financial organization (aka the postman), to obtain funds. The sale of receivables in essence, the ownership of receivables to the factor that indicates the factor acquires all the rights and risks include the claims. Therefore, the factor may be entitled, receive payments from the debtor for the amount of the invoice and must be the loss if the debtor to pay the bill. Typically, the account debtor from the sale of receivables, invoice factor and the debtor notified and takes all collections. Crucial for the factoring transaction, the seller should not collect payments from the account debtor, failing which the vendor may have risk factor for further progress are three essential parts of the factoring business. a.) the advance, a percentage of the invoice face value is paid to the seller on presentation, b) the reserve, the balance of the total bill is held up for payment by the debtor’s account and done c) taxes, the cost of transaction that is associated deducted from the reserve before being released to the seller. Sometimes the load on the seller’s service fee, plus interest based on the factor of time to wait for payment by the debtor. The factor is also estimated that the amount can not be seen for non-payment, allowing accommodation for the determination of the amount paid to the seller. The total benefit factor is the difference between the price of the bill and the amount collected from the debtor, lost less the amount paid for non-payment.